Has the Rise of Work-from-Home Reduced the Motherhood Penalty in the Labor Market? | University of Virginia and University of Southern California

Workforce Trends

According to the LeanIn and McKinsey & Company’s 2023 Women in the Workplace Report, the largest study on women in corporate America, flexibility, such as the option to work from home (WFH), is highly valued by working mothers, with 57% stating they would leave their employer or reduce work hours without it. In a recent study by researchers at the University of Virginia and the University of Southern California, it was found that “on average, a 10% increase in WFH is associated with a 0.78 percentage point (or 0.94%) increase in mothers’ employment relative to that of other women. This result is even more pronounced in fields traditionally considered less family-friendly. These findings underscore the pivotal role of WFH in talent attraction and retention, especially for working mothers. I am resharing insights from a recent study on return-to-office (RTO) mandates, which examines 137 S&P 500 firms that publicly announced RTO mandates, analyzing their financial performance before and after implementation. Glassdoor employee reviews for these organizations were also scrutinized. Key findings include: 1) No significant changes were observed in the financial performance or stock market value of these firms after RTO mandates. 2) Glassdoor data suggests that RTO mandates adversely affected employee satisfaction. While the study is not without limitations, part of these findings challenge the notion that in-person office attendance drives company performance.